Since starting my professional career as a management associate at a bank twenty-five years ago, I have had the opportunity to analyze, participate in, and work with countless small and diverse businesses. One truth that is clearer to me now than ever before is that business growth is not as much a determinant of success as is business evolution.
While it is true that a successful business will grow, it is also true that businesses grow and then fail, which is certainly not the goal when growth occurs. In contrast, a business that evolves, will by definition survive, adapt, and thrive as time goes by.
So then, what are the characteristics that allow a business to evolve in the current (and future) business environment? I would suggest that the characteristics are the same as any living organism that evolves through the process of natural selection.
Natural selection is defined as “the gradual, non-random process by which biological traits become either more or less common in a population as a function of differential reproduction of their bearers”.
Translated to business, I define business evolution as the intentional process by which certain business characteristics become more or less common in the marketplace as a function of the entrepreneurial success of the business owners. As an example, think about business characteristics such as employee satisfaction, diversity, corporate responsibility, sustainability, business liquidity, etc.
There are three components to evolution by natural selection that are relevant to business development.
- Diversity – Every business is unique and brings different skills, abilities, and benefits (characteristics) to the marketplace.
- Fitness – Differences in business characteristics will place some businesses at an advantage over other businesses in the marketplace.
- Advantage – Businesses with a sustained advantage will survive in the marketplace, and thrive to the extent of their advantage. Those businesses that do not have an advantage will not survive, and may become extinct.
Here is the rub; just like the dinosaur in world history, a business may grow large in a particular cycle but may not have the ability (fitness) to adapt to a new environment in a later cycle. Not only must a business have an advantage to thrive in the current marketplace, it must be able to transition and adapt with changes in the market. Business journals and publications from ten, 20, and 50 years ago are full of businesses that “went the way of the dinosaur”, because they lacked the ability to evolve and therefore became extinct as their environment changed.
Current business environment changes in financial management, the use of technology, marketing strategies, diversity & inclusion, and talent management will leave a business on the endangered species list if it fails to adapt to the current environment, and not only pursue business growth but also pursue business evolution.
– Shelton A. Russell, Evolution Supportive Services